As South Carolina’s largest health system, Greenville-based Prisma Health faced limited opportunities to grow within its home state. To continue expanding, the system turned to a multistate growth strategy — but with a deliberately tight geographic footprint.
That approach led to Prisma’s first out-of-state acquisition in December: Blount Memorial Hospital, a 304-bed, former county-owned facility in Maryville, Tenn.
Prisma President and CEO Mark O’Halla discussed the decision during Becker’s CEO+CFO Virtual Forum, explaining how the deal fits into the system’s vision of building a geographically focused, multistate network that brings scale, resources and operational expertise without overextending leadership.
For Mr. O’Halla, growth isn’t about size — it’s about cultural fit, thoughtful execution and delivering measurable benefits quickly to newly acquired hospitals. In the conversation that follows, he shares how Prisma evaluates potential acquisitions, the key lessons he’s learned from hospital consolidation, and why integration speed and delivering value from day one are critical to long-term success.
Editor’s note: This is an excerpt from a virtual panel at Becker’s CEO+CFO Virtual Forum. Responses are lightly edited for length and clarity.
Question: Prisma recently completed its first out-of-state hospital acquisition, expanding into Tennessee. What was it about the market and the timing of this deal that made sense for Prisma?
Mark O’Halla: Prisma is the largest health system in South Carolina, and because of that, it was going to be very difficult for us to pursue any acquisitions within the state — our footprint was just too big. So, as we thought about how to continue to grow, we realized it had to be a multistate strategy. But it couldn’t be a strategy that was so far-flung that we’d be looking at places like New York, California or Texas. That wasn’t something I was interested in. I really wanted to keep the geography relatively concise, so we’d be able to easily travel back and forth to any new additions we might bring into the system.
Blount Memorial was a county-owned entity that, frankly, had significant financial problems and operational challenges. They began looking for a partner, and we really didn’t know much about them before they reached out to us. They contacted us and said, “Look, we can’t do this on our own. The industry is too complicated.” There was a lot of competitive pressure rolling out from Knoxville and they felt they needed a larger partner who could bring scale and expertise that they just didn’t have as a county-owned facility.
When we looked at it, we saw a very good community hospital — a mid-sized, $350 million operation. We thought the geographic location was a good fit, the demographics were strong, and Maryville is a growing community. It was close enough to us that we could easily get there and maintain routine interaction with their leadership and team members. That was key — we wanted to ensure we could actually transfer the benefits we believe we can offer, and not have to do it from a distance.
That’s why we moved forward with it. After thoroughly evaluating the organization, we felt we could help them grow. We believed the building blocks were in place for a very successful hospital in that community. Again, getting back to the idea of a tight geographic footprint — this allows us to focus on northwestern South Carolina, eastern Tennessee and northern Georgia as a contiguous, multistate block where I think it makes sense for us to continue looking for growth opportunities.
Q: You mentioned earlier the importance of “looking under the hood” when evaluating potential acquisitions. What are the key metrics or factors you and your team focus on when assessing whether to move forward with a hospital acquisition?
MOH: Before I even get to the metrics, I need to know that the cultural fit makes sense. If it looks like a good cultural match, then we move into a fairly standard process.
In terms of metrics, we look at the balance sheet, we assess what kinds of challenges they’re facing with debt, and what kind of issues they have with cash flow. We’ll also run a stress test on the balance sheet. Then we look at the market demographics — what does the market look like? Is it a growing market or a declining one? Are there other industries flourishing in that particular community? We also look at what gaps exist — and whether the things they lack are things we can provide, like physician recruitment initiatives or greater scale and scope, especially when it comes to IT.
That’s probably the single biggest issue for many of the organizations we’ve been in discussions with. At Blount Memorial, in particular, they were working with a patchwork of older IT systems. They didn’t have the financial ability to go out and invest in new health information systems. That was one of the biggest benefits we were able to offer them.
We run on Epic, Workday, and we have a number of additional integrated systems like Cipher and others — systems Blount Memorial never would have been able to afford on its own. Those are the kinds of things we typically evaluate when we’re considering a potential partnership or acquisition.
Q: What’s the most important or impactful lesson you’ve learned about hospital consolidation during your time as a CEO?
MOH: It can’t be about size — it has to be about execution and what you can actually deliver. You need to have an integration plan that’s well thought out, and you need to execute on it quickly so you can bring those benefits to the new organization that’s just joined the system.
The key questions are: How do you bring benefit fast? How do you reduce costs, increase access, improve quality, enhance safety and elevate the patient experience? You’ve got to have a plan. And if you execute that plan well, I believe you’re going to be successful.
